Philippine South China Sea gas find may fuel China tensions

MANILA--A Philippine exploration firm has found a potentially large deposit of natural gas in a disputed area of the South China Sea, a discovery likely to inflame territorial tensions with China.

Philex Petroleum Corp. said in a disclosure to the stock exchange on Tuesday that its unit, Forum Energy PLC, “is expected to show an improvement in the resources previously known” in the Sampaguita gas discovery in the Reed Bank.

The area is claimed by both nations and last year Chinese navy vessels tried to ram one of Forum Energy's survey ships there, almost halting its research work. China has territorial disputes with the Philippines, Vietnam, Brunei, Malaysia and Taiwan across the South China Sea, and these nations are worried about what some see as growing Chinese assertiveness in staking claims over the sea's islands, reefs and shoals.

The territorial disputes are pushing the Philippines to seek closer cooperation with the United States, which has drawn Chinese condemnation.

A 2006 study quoted by Forum Energy said the Sampaguita field had a potential of up to 20 trillion cubic feet of natural gas, or more than five times initial estimates.

Energy Secretary Jose Rene Almendras said the findings could support plans to build a multimillion-dollar pipeline from the area to Manila.

“If it's true and it's big, then hopefully the resources will help us face the need for energy in the future,” Almendras said in an interview with local TV network ANC.

The Sampaguita gas field is near the Malampaya gas field, with about 2.7 trillion cubic feet of natural gas, and supplies fuel to three power plants for the main Luzon island.